Two stocks to watch as the IT sector index beats market gains - Kalkine Media

October 25, 2023 08:40 AM EDT | By Akanksha Vashisht
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Summary

  • The S&P/TSX Composite index inched 0.32% lower, while the S&P/TSX Capped IT index rose 2% on Tuesday.
  • Enghouse Systems, a software provider, saw intraday gains of 2.5% at the close of trade on Tuesday.
  • Docebo Inc., a cloud-based learning platform provider, saw intraday gains of 4.17% as at Tuesday’s close.

On Tuesday, October 24, 2023, the S&P/TSX Composite Index moved in the red, declining by 0.32% intraday. Meanwhile, the S&P/TSX Capped IT index moved in the green marking intraday gains of over 1% on Tuesday.

ALSO READ: CMG & SFTC: Two tech stocks to watch under US$20

The following two stocks also saw intraday gains of over 2% on Tuesday. Let us look at these stocks closely and examine their latest financial results.

Enghouse Systems Limited (TSX: ENGH)

Enghouse Systems Ltd. offers software and services across a range of industries, with its two main divisions being: the Interactive Management Group and the Asset Management Group.

For the July 2023 quarter, the company experienced a growth of 8.7% in revenue, and a 13.8% expansion in recurring revenue, reaching CA$72.3 million in comparison to the previous year. The operational profitability for the quarter also saw positive gains, achieving an EBITDA margin of 30.1%.

The increase in operating cash flows can be attributed to improved operating profits and more efficient cash collections.

Enghouse’s Board gave its approval for the company's upcoming quarterly dividend of CA$0.22 per common share, which will be disbursed to shareholders on November 30, 2023. The dividend would be paid to shareholders recorded as such at the end of business on November 16, 2023.

ENGH Price Chart; Powered By: TradingView

As at Tuesday’s market close, ENGH rose by 2.5% intraday and by around 14% on a one-month basis. Based on Tuesday’s closing price of CA$33.60, ENGH has a P/E ratio of 21.56x and a dividend yield of 2.62%.

ALSO READ: Two tech stocks surpassing market returns

Docebo Inc. (TSX: DCBO)

Docebo Inc provides a cloud-based learning platform designed for enterprise learning, both internally and externally.

For Q2 2023, Docebo’s revenue reached US$43.6 million, marking a 25% growth compared to the same period in the previous year. Subscription revenue amounted to US$40.8 million, constituting 94% of the total revenue. This figure saw a 28% increase from the equivalent period in the prior year.

Gross profit stood at US$35.2 million, reflecting a 26% rise from the comparative period in the prior year. This profit accounts for 81% of the revenue, which is a slight increase from the 80% reported during the same period in the prior year.

On the other hand, there was a net loss of US$5.7 million, or a loss of US$0.17 per share, in contrast to a net income of US$2.1 million, or US$0.06 per share, in the comparative period from the previous year.

DCBO Price Chart; Powered By: TradingView

Based on Tuesday’s closing price of CA$56.76, DCBO has a P/E ratio of 196.64x. At Tuesday’s market close, the stock saw intraday gains of 4.17% and YTD gains of 23.85%.

 


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